LVMH-Tiffany case comes to court
The saga of the $16 billion acquisition of US brand Tiffany by luxury group LVMH continues.
In November 2019, LVMH announced its intention to acquire Tiffany at a price that valued the New York-based jewellery and accessories brand at $16 billion, making this the luxury industry’s biggest ever acquisition.
Doubts about how much value for money this represented appeared to circulate among LVMH shareholders in June, leading commentators to suggest the French group was trying to drive the price down.
In August, by when the original deal was to be complete, the two parties announced an extension, setting November 24 as the final deadline for completing the purchase.
Then, on September 10, amid wider trade tensions between France and the US, LVMH issued a remarkable statement saying France’s minister of foreign affairs, Jean-Yves Le Drian, had “directed” it to postpone the Tiffany deal until 2021. Taking the discussions past November 24 meant it would not be able to complete the deal “as it stands”, LVMH said.
Tiffany has accused LVMH of running down the clock on the deal and has asked for a court in Delaware to speed through a hearing on the case in the hope of securing the agreed purchase price in full.
LVMH has said in response that the courts should take their time and examine the whole affair, including what it calls poor management of the covid-19 crisis on the part of the board of Tiffany.
An initial hearing on September 21 will decide if the expedited proceedings that Tiffany has asked for can go ahead.
